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Pædagogernes Pension (PBU), the €9.5 billion Danish pension fund for early childhood teachers, is consolidating its listed equity portfolio by reducing the number of external managers, according to a recent interview by Top1000funds. This strategy aims to enhance ESG oversight by decreasing the number of companies in its 42% actively managed equity allocation.
Chief Investment Officer Carsten Warren Petersen stated, “We don’t know how many managers we will end up with in listed equity yet, but we will have fewer in the years to come than what we have now. Only this way can we be sufficiently knowledgeable about our portfolio.” The fund currently operates around 10 large, focused equity mandates. PBU seeks managers with strong ESG credentials and the ability to engage with companies on specific ESG factors. Petersen emphasised the need for a more integrated approach. “You can’t hide behind an external manager. You need to know what is going on and what type of companies are in the portfolio. We want to be able to truthfully call ourselves a responsible investor; this means we need to know more about where we are invested which means fewer companies and fewer managers,” he added for Top1000funds.
PBU maintains small allocations to infrastructure and real estate, preferring listed, liquid markets for agility and adaptability to market changes. Despite late-cycle concerns and increased risk levels, the fund is not reducing its equity allocation, which varies based on the age of its savers.
The current investment team counts seven investment professionals, but all allocations are outsourced, with the exception of the 9 per cent real estate allocation which is run in-house.
